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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Vedanta | LSE:VED | London | Ordinary Share | GB0033277061 | ORD USD0.10 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 832.60 | 834.80 | 835.80 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
By Alex MacDonald
LONDON--Cairn India Ltd. (532792.BY) plans to defend itself against an order from the Indian Income Tax Department to pay 204.95 billion rupees ($3.3 billion) in taxes and interest, noting that the charge is "quite irrational on many accounts," the company's Chief Financial Officer said Friday.
Indian tax authorities charged the company last week for failing to pay witholding taxes on gains made by its former parent Cairn Energy PLC (CNE.LN) in a share transfer transaction about eight years ago. Cairn Energy transferred shares internally as part of a group restructuring that laid the ground work for the public listing of Cairn India's shares in 2007.
Sudhir Mathur said there was no taxable event in the share transfer since the economic interest never changed hands: "The economic owner remained the same prior to and after" the event. Mr. Mathur was speaking at an investor day presentation held by Cairn India's parent company, Vedanta Resources PLC, which owns a majority stake in the India-focused oil and gas explorer.
Mr. Mathur said Cairn India is working with its lawyers to provide a response to the tax authorities by the April 10 deadline. He said that there are several possible legal options that Cairn India could pursue.
Vedanta Resources' Chief Financial Officer DD Jalan also said at the same investor day that "there is no rationale for this tax to be levied on Cairn India." He added that even if there was cause for levying such a tax, it would have been the responsibility of Cairn Energy, the parent company at the time.
Indian tax authorities have also charged Cairn Energy with a $1.6 billion charge for the same reason.
Vedanta has no plans to book a provision for the tax charge, Mr. Jalan said, although he noted that the tax charge may show up as a contingent liability on Cairn India's books.
-Write to Alex MacDonald at alex.macdonald@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
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